What are Advertising Contributions for Engineering For Kids franchises comprised of?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
ion 9.4 below); and/or (c) spend amounts on local advertising (as described in Section 9.5 below) in such amounts as we designate under Section 9.2.1 below, provided that the amounts that we require will not, in the aggregate, exceed an amount equal to (i) four percent (4%) of the Gross Sales of the Franchised Business during the preceding Period, plus (if applicable) (ii) the amount by which the Minimum Local Ad Spend (as defined below) exceeds your then-current Local Ad Percentage Spend (as defined below) for the Period (the "Advertising Obligation").
- 9.2.1. We will specify the respective portions of the Advertising Obligation that you must contribute to the Brand Fund, contribute to any Regional Fund, and/or spend directly on local advertising and promotion, and we may adjust the respective portions from time to time. As of the Effective Date, the Advertising Obligations are allocated as: (a) contributions in the amount of two percent (2.0%) of your Gross Sales to the Brand Fund; and (b) expenditures on local advertising (in accordance with Section 9.5 below) in an amount equal to the greater of two percent (2.0%) of your Gross Sales for that Period (the "Local Ad Percentage Spend") or One Hundred Dollars ($100) (the "Minimum Local Ad Spend").
- 9.2.2. You understand that the Advertising Obligations are the amounts that we may require you to contribute or spend, and that these required amounts may not be suff
Source: Item 23 — RECEIPTS (FDD pages 53–138)
What This Means (2025 FDD)
According to Engineering For Kids's 2025 Franchise Disclosure Document, franchisees are required to participate in advertising and promotional activities. These obligations consist of contributions to the Brand Fund and local advertising expenditures. Specifically, franchisees must contribute two percent of their gross sales to the Brand Fund. Additionally, they are required to spend on local advertising an amount equal to the greater of two percent of their gross sales or $100.
Engineering For Kids retains the right to adjust the portions allocated to the Brand Fund, Regional Fund, and local advertising. Franchisees should recognize that the required advertising amounts may not always be sufficient to achieve adequate exposure for their franchised business. Therefore, franchisees have the option to spend additional amounts on advertising at their discretion. However, any additional spending beyond the required amounts will not reduce their obligations to the Brand Fund or any applicable Regional Fund.
Engineering For Kids also has the right to establish, maintain, and administer a system-wide Brand Fund for advertising, marketing, and promotional activities. The franchisor can use franchisee contributions and any earnings from the Brand Fund for various advertising and promotional programs, including online marketing, direct mail advertising, market research, and promotional materials. The franchisor can deduct 15% of the Brand Fund contributions for administration and management of the fund. Franchisees should note that there is no guarantee they will benefit from the Brand Fund in direct proportion to their contributions.